[Federal Register Volume 82, Number 126 (Monday, July 3, 2017)]
[Notices]
[Pages 30823-30828]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-13972]


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DEPARTMENT OF COMMERCE

Bureau of Industry and Security


Order Renewing Order Temporarily Denying Export Privileges

Mahan Airways, Mahan Tower, No. 21, Azadegan St., M.A. Jenah Exp. 
Way, Tehran, Iran
Pejman Mahmood Kosarayanifard a/k/a Kosarian Fard, P.O. Box 52404, 
Dubai, United Arab Emirates;
Mahmoud Amini, G#22 Dubai Airport Free Zone, P.O. Box 393754, Dubai, 
United Arab Emirates
    and
P.O. Box 52404, Dubai, United Arab Emirates
    and
Mohamed Abdulla Alqaz Building, Al Maktoum Street, Al Rigga, Dubai, 
United Arab Emirates;
Kerman Aviation a/k/a GIE Kerman Aviation, 42 Avenue Montaigne 
75008, Paris, France
Sirjanco Trading LLC, P.O. Box 8709, Dubai, United Arab Emirates
Ali Eslamian, 33 Cavendish Square, 4th Floor, London, W1G0PW, United 
Kingdom
    and
2 Bentinck Close, Prince Albert Road, St. Johns Wood, London NW87RY, 
United Kingdom
Mahan Air General Trading LLC, 19th Floor Al Moosa Tower One, Sheik 
Zayed Road, Dubai 40594, United Arab Emirates
Skyco (UK) Ltd., 33 Cavendish Square, 4th Floor, London, W1G 0PV, 
United Kingdom
Equipco (UK) Ltd., 2 Bentinck Close, Prince Albert Road, London, NW8 
7RY, United Kingdom
Mehdi Bahrami, Mahan Airways--Istanbul Office, Cumhuriye Cad. Sibil 
Apt No: 101 D:6, 34374 Emadad, Sisli Istanbul, Turkey
Al Naser Airlines a/k/a al-Naser Airlines a/k/a Alnaser Airlines and 
Air Freight Ltd., Home 46, Al-Karrada, Babil Region, District 929, 
St 21, Beside Al Jadirya Private Hospital, Baghdad, Iraq
    and
Al Amirat Street, Section 309, St. 3/H.20, Al Mansour, Baghdad, Iraq
    and
P.O. Box 28360, Dubai, United Arab Emirates
    and
P.O. Box 911399, Amman 11191, Jordan
Ali Abdullah Alhay, a/k/a Ali Alhay, a/k/a Ali Abdullah Ahmed Alhay, 
Home 46, Al-Karrada, Babil Region, District 929, St 21, Beside Al 
Jadirya Private Hospital, Baghdad, Iraq
    and
Anak Street, Qatif, Saudi Arabia 61177
Bahar Safwa General Trading, P.O. Box 113212, Citadel Tower, Floor-
5, Office #504, Business Bay, Dubai, United Arab Emirates
    and
P.O. Box 8709, Citadel Tower, Business Bay, Dubai, United Arab 
Emirates
Sky Blue Bird Group a/k/a Sky Blue Bird Aviation a/k/a Sky Blue Bird 
Ltd a/k/a Sky Blue Bird FZC, P.O. Box 16111, Ras Al Khaimah Trade 
Zone, United Arab Emirates
Issam Shammout a/k/a Muhammad Isam Muhammad Anwar Nur Shammout a/k/a 
Issam Anwar, Philips Building, 4th Floor, Al Fardous Street, 
Damascus, Syria
    and
Al Kolaa, Beirut, Lebanon 151515
    and
17-18 Margaret Street, 4th Floor, London, W1W 8RP, United Kingdom
    and
Cumhuriyet Mah. Kavakli San St. Fulya, Cad. Hazar Sok. No. 14/A 
Silivri, Istanbul, Turkey

    Pursuant to Section 766.24 of the Export Administration 
Regulations, 15 CFR parts 730-774 (2016) (``EAR'' or the 
``Regulations''),\1\ I hereby grant the request of the Office of Export 
Enforcement (``OEE'') to renew the December 30, 2016 Temporary Denial 
Order (the ``TDO''). The December 30, 2016 Order denied the export 
privileges of Mahan Airways, Pejman Mahmood Kosarayanifard, Mahmoud 
Amini, Kerman Aviation, Sirjanco Trading LLC, Ali Eslamian, Mahan Air 
General Trading LLC, Skyco (UK) Ltd., Equipco (UK) Ltd., Mehdi Bahrami, 
Al Naser Airlines, Ali Abdullah Alhay, Bahar Safwa General Trading, Sky 
Blue Bird Group, and Issam Shammout.\2\ I find that renewal of the TDO 
is necessary in the public interest to prevent an imminent violation of 
the EAR.
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    \1\ The Regulations, currently codified at 15 CFR parts 730-774 
(2017), originally issued pursuant to the Export Administration Act 
of 1979. Since August 21, 2001, the Act has been in lapse and the 
President, through Executive Order 13222 of August 17, 2001 (3 CFR, 
2001 Comp. 783 (2002)), which has been extended by successive 
Presidential Notices, the most recent being that of August 4, 2016 
(81 FR 52,58748,223 (Aug. 8, 2016)), has continued the Regulations 
in effect under the International Emergency Economic Powers Act (50 
U.S.C. 1701, et seq. (2006 & Supp. IV 2010)).
    \2\ See note 3, infra.
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I. Procedural History

    On March 17, 2008, Darryl W. Jackson, the then-Assistant Secretary 
of Commerce for Export Enforcement (``Assistant Secretary''), signed a 
TDO denying Mahan Airways' export privileges for a period of 180 days 
on the grounds that its issuance was necessary in the public interest 
to prevent an imminent violation of the Regulations. The TDO also named 
as denied persons Blue Airways, of Yerevan, Armenia (``Blue Airways of 
Armenia''), as well as the ``Balli Group Respondents,'' namely, Balli 
Group PLC, Balli Aviation, Balli Holdings, Vahid Alaghband, Hassan 
Alaghband, Blue Sky One Ltd., Blue Sky Two Ltd., Blue Sky Three Ltd., 
Blue Sky Four Ltd., Blue Sky Five Ltd., and Blue Sky Six Ltd., all of 
the United Kingdom. The TDO was issued ex parte pursuant to Section 
766.24(a), and went into effect on March 21, 2008, the date it was 
published in the Federal Register.
    The TDO subsequently has been renewed in accordance with Section 
766.24(d), including most recently on December 30, 2016.\3\ As of March 
9, 2010, the Balli Group Respondents and Blue Airways were no longer 
subject to the TDO. As part of the February 25, 2011 TDO renewal, 
Gatewick LLC (a/k/a Gatewick Freight and Cargo Services, a/k/a Gatewick 
Aviation Services), Mahmoud Amini, and Pejman Mahmood Kosarayanifard 
(``Kosarian Fard'') were added as related persons in accordance with 
Section 766.23 of the Regulations.\4\ On July 1, 2011, the TDO was 
modified by adding Zarand Aviation as a respondent in order to prevent 
an imminent violation.\5\ As part of the August 24, 2011 renewal, 
Kerman Aviation, Sirjanco Trading LLC, and Ali

[[Page 30824]]

Eslamian were added to the TDO as related persons. Mahan Air General 
Trading LLC, Skyco (UK) Ltd., and Equipco (UK) Ltd. were added as 
related persons on April 9, 2012. Mehdi Bahrami was added to the TDO as 
a related person as part of the February 4, 2013 renewal order.
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    \3\ The December 30, 2016 Order was published in the Federal 
Register on January 9, 2017 (82 FR 2312). July 13, 2016 (81 FR 
45276). The TDO previously had been renewed on September 17, 2008, 
March 16, 2009, September 11, 2009, March 9, 2010, September 3, 
2010, February 25, 2011, August 24, 2011, February 15, 2012, August 
9, 2012, February 4, 2013, July 31, 2013, January 24, 2014, July 22, 
2014, January 16, 2015, July 13, 2015, January 7, 2016, July 7, 
2016, and December 30, 2016. The August 24, 2011 renewal followed 
the modification of the TDO on July 1, 2011, which added Zarand 
Aviation as a respondent. The July 13, 2015 renewal followed the 
modification of the TDO on May 21, 2015, which added Al Naser 
Airlines, Ali Abdullah Alhay, and Bahar Safwa General Trading as 
respondents. Each renewal or modification order was published in the 
Federal Register.
    \4\ On August 13, 2014, BIS and Gatewick LLC resolved 
administrative charges against Gatewick, including a charge for 
acting contrary to the terms of a BIS denial order (15 CFR 
764.2(k)). In addition to the payment of a civil penalty, the 
settlement includes a seven-year denial order. The first two years 
of the denial period are active, with the remaining five years 
suspended on condition that Gatewick LLC pays the civil penalty in 
full and timely fashion and commits no further violation of the 
Regulations during the seven-year denial period. The Gatewick LLC 
Final Order was published in the Federal Register on August 20, 
2014. See 79 FR 49283 (Aug. 20, 2014).
    \5\ As of July 22, 2014, Zarand Aviation was no longer subject 
to the TDO.
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    On May 21, 2015, the TDO was modified to add Al Naser Airlines, Ali 
Abdullah Alhay, and Bahar Safwa General Trading as respondents. Sky 
Blue Bird Group and its chief executive officer Issam Shammout were 
added to the TDO as related persons as part of the July 13, 2015 
renewal order.\6\
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    \6\ The U.S. Department of the Treasury's Office of Foreign 
Assets Control (``OFAC'') designated Sky Blue Bird and Issam 
Shammout as Specially Designated Global Terrorists (``SDGTs'') on 
May 21, 2015, pursuant to Executive Order 13324, for ``providing 
support to Iran's Mahan Air.'' See 80 FR 30762 (May 29, 2015).
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    On June 5, 2017, BIS, through its Office of Export Enforcement 
(``OEE''), submitted a written request for renewal of the TDO. The 
written request was made more than 20 days before the scheduled 
expiration of the current TDO, which issued on December 30, 2016. 
Notice of the renewal request also was provided to Mahan Airways, Al 
Naser Airlines, Ali Abdullah Alhay, and Bahar Safwa General Trading in 
accordance with Sections 766.5 and 766.24(d) of the Regulations. No 
opposition to the renewal of the TDO has been received. Furthermore, no 
appeal of the related person determinations made as part of the 
September 3, 2010, February 25, 2011, August 24, 2011, April 9, 2012, 
February 4, 2013, and July 13, 2015 renewal or modification orders has 
been made by Kosarian Fard, Mahmoud Amini, Kerman Aviation, Sirjanco 
Trading LLC, Ali Eslamian, Mahan Air General Trading LLC, Skyco (UK) 
Ltd., Equipco (UK) Ltd., Mehdi Bahrami, Sky Blue Bird Group, or Issam 
Shammout.\7\
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    \7\ A party named or added as a related person may not oppose 
the issuance or renewal of the underlying temporary denial order, 
but may file an appeal of the related person determination in 
accordance with Section 766.23(c).
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II. Renewal of the TDO

A. Legal Standard

    Pursuant to Section 766.24, BIS may issue or renew an order 
temporarily denying a respondent's export privileges upon a showing 
that the order is necessary in the public interest to prevent an 
``imminent violation'' of the Regulations. 15 CFR 766.24(b)(1) and 
776.24(d). ``A violation may be `imminent' either in time or degree of 
likelihood.'' 15 CFR 766.24(b)(3). BIS may show ``either that a 
violation is about to occur, or that the general circumstances of the 
matter under investigation or case under criminal or administrative 
charges demonstrate a likelihood of future violations.'' Id. As to the 
likelihood of future violations, BIS may show that the violation under 
investigation or charge ``is significant, deliberate, covert and/or 
likely to occur again, rather than technical or negligent [.]'' Id. A 
``lack of information establishing the precise time a violation may 
occur does not preclude a finding that a violation is imminent, so long 
as there is sufficient reason to believe the likelihood of a 
violation.'' Id.

B. The TDO and BIS's Request for Renewal

    OEE's request for renewal is based upon the facts underlying the 
issuance of the initial TDO and the TDO renewals in this matter and the 
evidence developed over the course of this investigation indicating a 
blatant disregard of U.S. export controls and the TDO. The initial TDO 
was issued as a result of evidence that showed that Mahan Airways and 
other parties engaged in conduct prohibited by the EAR by knowingly re-
exporting to Iran three U.S.-origin aircraft, specifically Boeing 747s 
(``Aircraft 1-3''), items subject to the EAR and classified under 
Export Control Classification Number (``ECCN'') 9A991.b, without the 
required U.S. Government authorization. Further evidence submitted by 
BIS indicated that Mahan Airways was involved in the attempted re-
export of three additional U.S.-origin Boeing 747s (``Aircraft 4-6'') 
to Iran.
    As discussed in the September 17, 2008 renewal order, evidence 
presented by BIS indicated that Aircraft 1-3 continued to be flown on 
Mahan Airways' routes after issuance of the TDO, in violation of the 
Regulations and the TDO itself.\8\ It also showed that Aircraft 1-3 had 
been flown in further violation of the Regulations and the TDO on the 
routes of Iran Air, an Iranian Government airline. Moreover, as 
discussed in the March 16, 2009, September 11, 2009 and March 9, 2010 
Renewal Orders, Mahan Airways registered Aircraft 1-3 in Iran, obtained 
Iranian tail numbers for them (EP-MNA, EP-MNB, and EP-MNE, 
respectively), and continued to operate at least two of them in 
violation of the Regulations and the TDO,\9\ while also committing an 
additional knowing and willful violation when it negotiated for and 
acquired an additional U.S.-origin aircraft. The additional acquired 
aircraft was an MD-82 aircraft, which subsequently was painted in Mahan 
Airways' livery and flown on multiple Mahan Airways' routes under tail 
number TC-TUA.
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    \8\ Engaging in conduct prohibited by a denial order violates 
the Regulations. 15 CFR 764.2(a) and (k).
    \9\ The third Boeing 747 appeared to have undergone significant 
service maintenance and may not have been operational at the time of 
the March 9, 2010 renewal order.
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    The March 9, 2010 Renewal Order also noted that a court in the 
United Kingdom (``U.K.'') had found Mahan Airways in contempt of court 
on February 1, 2010, for failing to comply with that court's December 
21, 2009 and January 12, 2010 orders compelling Mahan Airways to remove 
the Boeing 747s from Iran and ground them in the Netherlands. Mahan 
Airways and the Balli Group Respondents had been litigating before the 
U.K. court concerning ownership and control of Aircraft 1-3. In a 
letter to the U.K. court dated January 12, 2010, Mahan Airways' 
Chairman indicated, inter alia, that Mahan Airways opposes U.S. 
Government actions against Iran, that it continued to operate the 
aircraft on its routes in and out of Tehran (and had 158,000 ``forward 
bookings'' for these aircraft), and that it wished to continue to do so 
and would pay damages if required by that court, rather than ground the 
aircraft.
    The September 3, 2010 renewal order discussed the fact that Mahan 
Airways' violations of the TDO extended beyond operating U.S.-origin 
aircraft and attempting to acquire additional U.S.-origin aircraft. In 
February 2009, while subject to the TDO, Mahan Airways participated in 
the export of computer motherboards, items subject to the Regulations 
and designated as EAR99, from the United States to Iran, via the United 
Arab Emirates (``UAE''), in violation of both the TDO and the 
Regulations, by transporting and/or forwarding the computer 
motherboards from the UAE to Iran. Mahan Airways' violations were 
facilitated by Gatewick LLC, which not only participated in the 
transaction, but also has stated to BIS that it acted as Mahan Airways' 
sole booking agent for cargo and freight forwarding services in the 
UAE.
    Moreover, in a January 24, 2011 filing in the U.K. court, Mahan 
Airways asserted that Aircraft 1-3 were not being used, but stated in 
pertinent part that the aircraft were being maintained in Iran 
especially ``in an airworthy condition'' and that, depending on the 
outcome of its U.K. court appeal, the aircraft ``could immediately go 
back into service . . . on international routes into and out of Iran.'' 
Mahan Airways' January 24, 2011 submission to U.K. Court of Appeal, at 
p. 25, ]] 108, 110.

[[Page 30825]]

This clearly stated intent, both on its own and in conjunction with 
Mahan Airways' prior misconduct and statements, demonstrated the need 
to renew the TDO in order to prevent imminent future violations. Two of 
these three 747s subsequently were removed from Iran and are no longer 
in Mahan Airways' possession. The third of these 747s, with 
Manufacturer's Serial Number (``MSN'') 23480 and Iranian tail number 
EP-MNE, remained in Iran under Mahan's control. Pursuant to Executive 
Order 13324, it was designated a Specially Designated Global Terrorist 
(``SDGT'') by the U.S. Department of the Treasury's Office of Foreign 
Assets Control (``OFAC'') on September 19, 2012.\10\ Furthermore, as 
discussed in the February 4, 2013 Order, open source information 
indicated that this 747, painted in the livery and logo of Mahan 
Airways, had been flown between Iran and Syria, and was suspected of 
ferrying weapons and/or other equipment to the Syrian Government from 
Iran's Islamic Revolutionary Guard Corps. Open source information 
showed that this aircraft had flown from Iran to Syria as recently as 
June 30, 2013, and continues to show that it remains in active 
operation in Mahan Airways' fleet.
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    \10\ See http://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/pages/20120919.aspx.
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    In addition, as first detailed in the July 1, 2011 and August 24, 
2011 orders, and discussed in subsequent renewal orders in this matter, 
Mahan Airways also continued to evade U.S. export control laws by 
operating two Airbus A310 aircraft, bearing Mahan Airways' livery and 
logo, on flights into and out of Iran.\11\ At the time of the July 1, 
2011 and August 24, 2011 Orders, these Airbus A310s were registered in 
France, with tail numbers F-OJHH and F-OJHI, respectively.\12\
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    \11\ The Airbus A310s are powered with U.S.-origin engines. The 
engines are subject to the EAR and classified under Export Control 
Classification (``ECCN'') 9A991.d. The Airbus A310s contain 
controlled U.S.-origin items valued at more than 10 percent of the 
total value of the aircraft and as a result are subject to the EAR. 
They are classified under ECCN 9A991.b. The export or reexport of 
these aircraft to Iran requires U.S. Government authorization 
pursuant to Sections 742.8 and 746.7 of the Regulations.
    \12\ OEE subsequently presented evidence that after the August 
24, 2011 renewal, Mahan Airways worked along with Kerman Aviation 
and others to de-register the two Airbus A310 aircraft in France and 
to register both aircraft in Iran (with, respectively, Iranian tail 
numbers EP-MHH and EP-MHI). It was determined subsequent to the 
February 15, 2012 renewal order that the registration switch for 
these A310s was cancelled and that Mahan Airways then continued to 
fly the aircraft under the original French tail numbers (F-OJHH and 
F-OJHI, respectively). Both aircraft apparently remain in Mahan 
Airways' possession.
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    The August 2012 renewal order also found that Mahan Airways had 
acquired another Airbus A310 aircraft subject to the Regulations, with 
MSN 499 and Iranian tail number EP-VIP, in violation of the TDO and the 
Regulations.\13\ On September 19, 2012, all three Airbus A310 aircraft 
(tail numbers F-OJHH, F-OJHI, and EP-VIP) were designated as SDGTs.\14\
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    \13\ See note 12, supra.
    \14\ See http://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/pages/20120919.aspx. Mahan Airways was previously 
designated by OFAC as a SDGT on October 18, 2011. 77 FR 64,427 
(October 18, 2011).
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    The February 4, 2013 Order laid out further evidence of continued 
and additional efforts by Mahan Airways and other persons acting in 
concert with Mahan, including Kral Aviation and another Turkish 
company, to procure U.S.-origin engines--two GE CF6-50C2 engines, with 
MSNs 517621 and 517738, respectively--and other aircraft parts in 
violation of the TDO and the Regulations.\15\ The February 4, 2013 
renewal order also added Mehdi Bahrami as a related person in 
accordance with Section 766.23 of the Regulations. Bahrami, a Mahan 
Vice-President and the head of Mahan's Istanbul Office, also was 
involved in Mahan's acquisition of the original three Boeing 747s 
(Aircraft 1-3) that resulted in the original TDO, and has had a 
business relationship with Mahan dating back to 1997.
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    \15\ Kral Aviation was referenced in the February 4, 2013 Order 
as ``Turkish Company No. 1.'' Kral Aviation purchased a GE CF6-50C2 
aircraft engine (MSN 517621) from the United States in July 2012, on 
behalf of Mahan Airways. OEE was able to prevent this engine from 
reaching Mahan by issuing a redelivery order to the freight 
forwarder in accordance with Section 758.8 of the Regulations. OEE 
also issued Kral Aviation a redelivery order for the second CF6-50C2 
engine (MSN 517738) on July 30, 2012. The owner of the second engine 
subsequently cancelled the item's sale to Kral Aviation. In 
September 2012, OEE was alerted by a U.S. exporter that another 
Turkish company (``Turkish Company No. 2'') was attempting to 
purchase aircraft spare parts intended for re-export by Turkish 
Company No. 2 to Mahan Airways. See February 4, 2013 Order.
    On December 31, 2013, Kral Aviation was added to BIS's Entity 
List, Supplement No. 4 to Part 744 of the Regulations. See 78 FR 
75458 (Dec. 12, 2013). Companies and individuals are added to the 
Entity List for engaging in activities contrary to the national 
security or foreign policy interests of the United States. See 15 
CFR 744.11.
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    The July 31, 2013 Order detailed additional evidence obtained by 
OEE showing efforts by Mahan Airways to obtain another GE CF6-50C2 
aircraft engine (MSN 528350) from the United States via Turkey. 
Multiple Mahan employees, including Mehdi Bahrami, were involved in or 
aware of matters related to the engine's arrival in Turkey from the 
United States, plans to visually inspect the engine, and prepare it for 
shipment from Turkey.
    Mahan sought to obtain this U.S.-origin engine through Pioneer 
Logistics Havacilik Turizm Yonetim Danismanlik (``Pioneer Logistics''), 
an aircraft parts supplier located in Turkey, and its director/
operator, Gulnihal Yegane, a Turkish national who previously had 
conducted Mahan related business with Mehdi Bahrami and Ali Eslamian. 
Moreover, as referenced in the July 31, 2013 Order, a sworn affidavit 
by Kosol Surinanda, also known as Kosol Surinandha, Managing Director 
of Mahan's General Sales Agent in Thailand, stated that the shares of 
Pioneer Logistics for which he was the listed owner were ``actually the 
property of and owned by Mahan.'' He further stated that he held 
``legal title to the shares until otherwise required by Mahan'' but 
would ``exercise the rights granted to [him] exactly and only as 
instructed by Mahan and [his] vote and/or decisions [would] only and 
exclusively reflect the wills and demands of Mahan[.]'' \16\
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    \16\ Pioneer Logistics, Gulnihal Yegane, and Kosol Surinanda 
also were added to the Entity List on December 12, 2013. See 78 FR 
75458 (Dec. 12, 2013).
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    The January 24, 2014 Order outlined OEE's continued investigation 
of Mahan Airways' activities and detailed an attempt by Mahan, which 
OEE thwarted, to obtain, via an Indonesian aircraft parts supplier, two 
U.S.-origin Honeywell ALF-502R-5 aircraft engines (MSNs LF5660 and 
LF5325), items subject to the Regulations, from a U.S. company located 
in Texas. An invoice of the Indonesian aircraft parts supplier dated 
March 27, 2013, listed Mahan Airways as the purchaser of the engines 
and included a Mahan ship-to address. OEE also obtained a Mahan air 
waybill dated March 12, 2013, listing numerous U.S.-origin aircraft 
parts subject to the Regulations--including, among other items, a 
vertical navigation gyroscope, a transmitter, and a power control 
unit--being transported by Mahan from Turkey to Iran in violation of 
the TDO.
    The July 22, 2014 Order discussed open source evidence from the 
March-June 2014 time period regarding two BAE regional jets, items 
subject to the Regulations, that were painted in the livery and logo of 
Mahan Airways and operating under Iranian tail numbers EP-MOK and EP-
MOI, respectively.\17\

[[Page 30826]]

In addition, aviation industry resources indicated that these aircraft 
were obtained by Mahan Airways in late November 2013 and June 2014, 
from Ukrainian Mediterranean Airline, a Ukrainian airline that was 
added to BIS's Entity List (Supplement No. 4 to Part 744 of the 
Regulations) on August 15, 2011, for acting contrary to the national 
security and foreign policy interests of the United States.\18\ OEE's 
on-going investigation indicates that both BAE regional jets remain 
active in Mahan's fleet, with open source information showing EP-MOI 
being used on flights into and out of Iran as recently as January 12, 
2015. The continued operation of these aircraft by Mahan Airways 
violates the TDO.
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    \17\ The BAE regional jets are powered with U.S.-origin engines. 
The engines are subject to the EAR and classified under ECCN 
9A991.d. These aircraft contain controlled U.S.-origin items valued 
at more than 10 percent of the total value of the aircraft and as a 
result are subject to the EAR. They are classified under ECCN 
9A991.b. The export or reexport of these aircraft to Iran requires 
U.S. Government authorization pursuant to Sections 742.8 and 746.7 
of the Regulations.
    \18\ See 76 FR 50407 (Aug. 15, 2011). The July 22, 2014 TDO 
renewal order also referenced two Airbus A320 aircraft painted in 
the livery and logo of Mahan Airways and operating under Iranian 
tail numbers EP-MMK and EP-MML, respectively. OEE's investigation 
also showed that Mahan obtained these aircraft in November 2013, 
from Khors Air Company, another Ukrainian airline that, like 
Ukrainian Mediterranean Airlines, was added to BIS's Entity List on 
August 15, 2011. Open source evidence indicates the two Airbus A320 
aircraft may be been transferred by Mahan Airways to another Iranian 
airline in October 2014, and issued Iranian tail numbers EP-APE and 
EP-APF, respectively.
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    The January 16, 2015 Order detailed evidence of additional attempts 
by Mahan Airways to acquire items subject the Regulations in further 
violation of the TDO. Specifically, in March 2014, OEE became aware of 
an inertial reference unit bearing serial number 1231 (``the IRU'') 
that had been sent to the United States for repair. The IRU is subject 
to the Regulations, classified under ECCN 7A103, and controlled for 
missile technology reasons. Upon closer inspection, it was determined 
that IRU came from or had been installed on an Airbus A340 aircraft 
bearing MSN 056. Further investigation revealed that as of 
approximately February 2014, this aircraft was registered under Iranian 
tail number EP-MMB and had been painted in the livery and logo of Mahan 
Airways.
    The January 16, 2015 Order also described related efforts by the 
Departments of Justice and Treasury to further thwart Mahan's illicit 
procurement efforts. Specifically, on August 14, 2014, the United 
States Attorney's Office for the District of Maryland filed a civil 
forfeiture complaint for the IRU pursuant to 22 U.S.C. 401(b) that 
resulted in the court issuing an Order of Forfeiture on December 2, 
2014. EP-MMB remains listed as active in Mahan Airways' fleet.
    Additionally, on August 29, 2014, OFAC blocked the property and 
interests in property of Asian Aviation Logistics of Thailand, a Mahan 
Airways affiliate or front company, pursuant to Executive Order 13224. 
In doing so, OFAC described Mahan Airways' use of Asian Aviation 
Logistics to evade sanctions by making payments on behalf of Mahan for 
the purchase of engines and other equipment.\19\
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    \19\  See http://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/20140829.aspx. See 79 FR 55073 (Sep. 15, 
2014). OFAC also blocked the property and property interests of 
Pioneer Logistics of Turkey on August 29, 2014. Id. Mahan Airways' 
use of Pioneer Logistics in an effort to evade the TDO and the 
Regulations was discussed in a prior renewal order, as summarized, 
supra, at 13-14. BIS added both Asian Aviation Logistics and Pioneer 
Logistics to the Entity List on December 12, 2013. See 78 FR 75458 
(Dec. 12, 2013).
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    The May 21, 2015 modification order detailed the acquisition of two 
aircraft, specifically an Airbus A340 bearing MSN 164 and an Airbus 
A321 bearing MSN 550, that were purchased by Al Naser Airlines in late 
2014/early 2015 and are currently located in Iran under the possession, 
control, and/or ownership of Mahan Airways.\20\ The sales agreements 
for these two aircraft were signed by Ali Abdullah Alhay for Al Naser 
Airlines.\21\ Payment information reveals that multiple electronic 
funds transfers (``EFT'') were made by Ali Abdullah Alhay and Bahar 
Safwa General Trading in order to acquire MSNs 164 and 550.
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    \20\ Both of these aircraft are powered by U.S.-origin engines 
that are subject to the Regulations and classified under ECCN 
9A991.d. Both aircraft contain controlled U.S.-origin items valued 
at more than 10 percent of the total value of the aircraft and as a 
result are subject to the EAR regardless of their location. The 
aircraft are classified under ECCN 9A991.b. The export or re-export 
of these aircraft to Iran requires U.S. Government authorization 
pursuant to Sections 742.8 and 746.7 of the Regulations.
    \21\ Ali Abdullah Alhay is a 25% owner of Al Naser Airlines.
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    The May 21, 2015 modification order also laid out evidence showing 
the respondents' attempts to obtain other controlled aircraft, 
including aircraft physically located in the United States in 
similarly-patterned transactions during the same recent time period. 
Transactional documents involving two Airbus A320s bearing MSNs 82 and 
99, respectively, again showed Ali Abdullah Alhay signing sales 
agreements for Al Naser Airlines.\22\ A review of the payment 
information for these aircraft similarly revealed EFTs from Ali 
Abdullah Alhay and Bahar Safwa General Trading that follow the pattern 
described for MSNs 164 and 550, supra. MSNs 82 and 99 were detained by 
OEE Special Agents prior to their planned export from the United 
States.
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    \22\ Both aircraft were physically located in the United States 
and therefore are subject to the Regulations pursuant to Section 
734.3(a)(1). Moreover, these Airbus A320s are powered by U.S.-origin 
engines that are subject to the Regulations and classified under 
Export Control Classification Number ECCN 9A991.d. The Airbus A320s 
contain controlled U.S.-origin items valued at more than 10 percent 
of the total value of the aircraft and as a result are subject to 
the EAR regardless of their location. The aircraft are classified 
under ECCN 9A991.b. The export or re-export of these aircraft to 
Iran requires U.S. Government authorization pursuant to Sections 
742.8 and 746.7 of the Regulations.
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    The July 13, 2015 Order outlined evidence showing that Al Naser 
Airlines' attempts to acquire aircraft on behalf of Mahan Airways 
extended beyond MSNs 164 and 550 to include a total of nine 
aircraft.\23\ Four of the aircraft, all of which are subject to the 
Regulations and were obtained by Mahan from Al Naser Airlines, had been 
issued the following Iranian tail numbers: EP-MMD (MSN 164), EP-MMG 
(MSN 383), EP-MMH (MSN 391) and EP-MMR (MSN 416), respectively.\24\ 
Publicly available flight tracking information provided evidence that 
at the time of the July 13, 2015 renewal, both EP-MMH and EP-MMR were 
being actively flown on routes into and out of Iran in violation of the 
TDO and Regulations.\25\
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    \23\ This evidence included a press release dated May 9, 2015, 
that appeared on Mahan Airways' Web site and stated that Mahan 
``added 9 modern aircraft to its air fleet [,]'' and that the newly 
acquired aircraft included eight Airbus A340s and one Airbus A321. 
See http://www.mahan.aero/en/mahan-air/press-room/44. The press 
release was subsequently removed from Mahan Airways' Web site. 
Publicly available aviation databases similarly showed that Mahan 
had obtained nine additional aircraft from Al Naser Airlines in May 
2015, including MSNs 164 and 550. As also discussed in the July 13, 
2015 renewal order, Sky Blue Bird Group, via Issam Shammout, was 
actively involved in Al Naser Airlines' acquisition of MSNs 164 and 
550, and the attempted acquisition of MSNs 82 and 99 (which were 
detained by OEE).
    \24\ The Airbus A340s are powered by U.S.-origin engines that 
are subject to the Regulations and classified under ECCN 9A991.d. 
The Airbus A340s contain controlled U.S.-origin items valued at more 
than 10 percent of the total value of the aircraft and as a result 
are subject to the EAR regardless of their location. The aircraft 
are classified under ECCN 9A991.b. The export or re-export of these 
aircraft to Iran requires U.S. Government authorization pursuant to 
Sections 742.8 and 746.7 of the Regulations.
    \25\ There is some publicly available information indicating 
that the aircraft Mahan Airways is flying under Iranian tail number 
EP-MMR is now MSN 615, rather than MSN 416. Both aircraft are Airbus 
A340 aircraft that Mahan acquired from Al Naser Airlines in 
violation of the TDO and the Regulations. Moreover, both aircraft 
were designated as SDGTs by OFAC on May 21, 2015, pursuant to 
Executive Order 13324. See 80 FR 30762 (May 29, 2015).
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    The January 7, 2016 Order discussed evidence that Mahan Airways had 
begun actively flying EP-MMD, another

[[Page 30827]]

of the aircraft Mahan had obtained from Al Naser Airlines (as discussed 
in the July 13, 2015 renewal order), on international routes into and 
out of Iran, including from/to Bangkok, Thailand. Additionally, the 
January 7, 2016 Order described publicly available aviation database 
and flight tracking information indicating that Mahan Airways was 
continuing its efforts to acquire Iranian tail numbers and press into 
active service under Mahan's livery and logo at least two more of the 
Airbus A340 aircraft it had obtained from or through Al Naser Airlines: 
EP-MME (MSN 371) and EP-MMF (MSN 376), respectively. Since January 
2016, EP-MME has logged flights to and from Tehran, Iran involving 
various destinations, including Guangzhou, China, and Dubai, United 
Arab Emirates in further violation of the TDO and the Regulations.
    The July 7, 2016 Order described Mahan Airways' acquisition of a 
BAE Avro RJ-85 aircraft (MSN E2392) in violation of the TDO and its 
subsequent registration under Iranian tail number EP-MOR.\26\ This 
information was corroborated by publicly available information on the 
Web site of Iran's civil aviation authority. The July 7, 2016 Order 
also outlined Mahan's continued operation of EP-MMF in violation of the 
TDO on routes from Tehran Iran to Beijing, China and Shanghai, China, 
respectively.
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    \26\ The BAE Avro RJ-85 is powered by U.S.-origin engines that 
are subject to the Regulations and classified under ECCN 9A991.d. 
The BAE Avro RJ-85 contains controlled U.S.-origin items valued at 
more than 10 percent of the total value of the aircraft and as a 
result is subject to the EAR regardless of its location. The 
aircraft is classified under ECCN 9A991.b, and its export or re-
export to Iran requires U.S. Government authorization pursuant to 
Sections 742.8 and 746.7 of the Regulations.
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    The December 30, 2016 Order outlined Mahan's continued operation of 
multiple Airbus aircraft, including EP-MMD (MSN 164), EP-MMF (MSN 376), 
and EP-MMH (MSN 391), which were acquired from or through Al Naser 
Airlines in violation of the TDO as previously detailed in the July 13, 
2015 and January 7, 2016 renewal orders, respectively. Publicly 
available flight tracking information showed that the aircraft were 
operated on flights into and out of Iran, including from/to Beijing, 
China, Kuala Lumpur, Malaysia, and Istanbul, Turkey.\27\
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    \27\ Specifically, on December 22, 2016, EP-MMD (MSN 164) flew 
from Dubai, UAE to Tehran, Iran. Between December 20 and December 
22, 2016, EP-MMF (MSN 376) flew on routes from Tehran, Iran to 
Beijing, China and Istanbul, Turkey, respectively. Between December 
26 and December 28, 2016, EP-MMH (MSN 391) flew on routes from 
Tehran, Iran to Kuala Lumpur, Malaysia.
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    OEE's June 5, 2017 renewal request includes similar evidence 
regarding Mahan's continuing violation of the TDO by operating multiple 
Airbus aircraft subject to the Regulations, including, but not limited 
to, aircraft procured from or through Al Naser Airlines, on flights 
into and out of Iran, including from/to Moscow, Russia, Shanghai, China 
and Kabul, Afghanistan.\28\
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    \28\ Publicly available flight tracking information shows that 
on June 22, 2017, EP-MME (MSN 371) flew from Moscow, Russia to 
Tehran, Iran. Additionally, between June 19, 2017, and June 20, 
2017, EP-MMQ (MSN 449), an Airbus A430 also obtained from or through 
Al Naser Airlines, flew on routes between Shanghai, China and 
Tehran, Iran. Similar flight tracking information shows that on June 
20, 2017, EP-MNK (MSN 618), an Airbus A300 originally acquired by 
Mahan via a Ukrainian company, flew between Kabul, Afghanistan and 
Mashhad, Iran.
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    OEE has also obtained additional information regarding the 
suspected diversion of an Airbus A340 that was first mentioned in its 
December 13, 2016 renewal request. This aircraft had been located and 
registered in the United States under tail number N278TA and was 
subject to the Regulations. At the time the December 30, 2016 renewal 
order was issued, this aircraft had been exported from the United 
States to Indonesia contrary to filings made with the U.S. Federal 
Aviation Administration (``FAA''). These filings with the FAA 
inaccurately indicated, first, that the aircraft was being flown to 
Almaty, Kazakhstan, and then indicated that the aircraft should be de-
registered in the United States because it was being exported to, and 
going to be registered in, Ukraine. Additional documents obtained by 
OEE included a copy of the sales agreement relating to this aircraft, 
which listed a UAE company as the purchaser. Moreover, an industry 
database indicated that the aircraft was being transferred or sold to 
Mahan Airways. After multiple attempts by OEE to contact the UAE 
company regarding OEE's concerns about any sale or other diversion to 
Mahan Airways, the same industry database was revised so as to indicate 
that the sale/transfer to Mahan had been cancelled. The timing of this 
revision is suspicious. Moreover, as discussed in prior renewal orders, 
Mahan Airways has used a broad network of agents and affiliates to 
unlawfully procure and attempt to procure aircraft and other items 
subject to the Regulations via third countries and sham or masked 
transactions, including via the UAE and Indonesia.

C. Findings

    Under the applicable standard set forth in Section 766.24 of the 
Regulations and my review of the entire record, I find that the 
evidence presented by BIS convincingly demonstrates that the denied 
persons have acted in violation of the Regulations and the TDO; that 
such violations have been significant, deliberate and covert; and that 
given the foregoing and the nature of the matters under investigation, 
there is a likelihood of future violations. Therefore, renewal of the 
TDO is necessary to prevent imminent violation of the Regulations and 
to give notice to companies and individuals in the United States and 
abroad that they should continue to cease dealing with Mahan Airways, 
Al Naser Airlines, and the other denied persons under the TDO in 
connection with export and reexport transactions involving items 
subject to the Regulations.

IV. Order

    It is therefore ordered:
    First, that MAHAN AIRWAYS, Mahan Tower, No. 21, Azadegan St., M.A. 
Jenah Exp. Way, Tehran, Iran; PEJMAN MAHMOOD KOSARAYANIFARD A/K/A 
KOSARIAN FARD, P.O. Box 52404, Dubai, United Arab Emirates; MAHMOUD 
AMINI, G#22 Dubai Airport Free Zone, P.O. Box 393754, Dubai, United 
Arab Emirates, and P.O. Box 52404, Dubai, United Arab Emirates, and 
Mohamed Abdulla Alqaz Building, Al Maktoum Street, Al Rigga, Dubai, 
United Arab Emirates; KERMAN AVIATION A/K/A GIE KERMAN AVIATION, 42 
Avenue Montaigne 75008, Paris, France; SIRJANCO TRADING LLC, P.O. Box 
8709, Dubai, United Arab Emirates; ALI ESLAMIAN, 33 Cavendish Square, 
4th Floor, London W1G0PW, United Kingdom, and 2 Bentinck Close, Prince 
Albert Road St. Johns Wood, London NW87RY, United Kingdom; MAHAN AIR 
GENERAL TRADING LLC, 19th Floor Al Moosa Tower One, Sheik Zayed Road, 
Dubai 40594, United Arab Emirates; SKYCO (UK) LTD., 33 Cavendish 
Square, 4th Floor, London, W1G 0PV, United Kingdom; EQUIPCO (UK) LTD., 
2 Bentinck Close, Prince Albert Road, London, NW8 7RY, United Kingdom; 
and MEHDI BAHRAMI, Mahan Airways- Istanbul Office, Cumhuriye Cad. Sibil 
Apt No: 101 D:6, 34374 Emadad, Sisli Istanbul, Turkey; AL NASER 
AIRLINES A/K/A AL-NASER AIRLINES A/K/A ALNASER AIRLINES AND AIR FREIGHT 
LTD., Home 46, Al-Karrada, Babil Region, District 929, St 21, Beside Al 
Jadirya Private Hospital, Baghdad, Iraq, and Al Amirat Street, Section 
309, St. 3/H.20, Al Mansour, Baghdad, Iraq, and P.O. Box 28360, Dubai, 
United Arab Emirates, and P.O.

[[Page 30828]]

Box 911399, Amman 11191, Jordan; ALI ABDULLAH ALHAY A/K/A ALI ALHAY A/
K/A ALI ABDULLAH AHMED ALHAY, Home 46, Al-Karrada, Babil Region, 
District 929, St 21, Beside Al Jadirya Private Hospital, Baghdad, Iraq, 
and Anak Street, Qatif, Saudi Arabia 61177; BAHAR SAFWA GENERAL 
TRADING, P.O. Box 113212, Citadel Tower, Floor-5, Office #504, Business 
Bay, Dubai, United Arab Emirates, and P.O. Box 8709, Citadel Tower, 
Business Bay, Dubai, United Arab Emirates; SKY BLUE BIRD GROUP A/K/A 
SKY BLUE BIRD AVIATION A/K/A SKY BLUE BIRD LTD A/K/A SKY BLUE BIRD FZC, 
P.O. Box 16111, Ras Al Khaimah Trade Zone, United Arab Emirates; and 
ISSAM SHAMMOUT A/K/A MUHAMMAD ISAM MUHAMMAD ANWAR NUR SHAMMOUT A/K/A 
ISSAM ANWAR, Philips Building, 4th Floor, Al Fardous Street, Damascus, 
Syria, and Al Kolaa, Beirut, Lebanon 151515, and 17-18 Margaret Street, 
4th Floor, London, W1W 8RP, United Kingdom, and Cumhuriyet Mah. Kavakli 
San St. Fulya, Cad. Hazar Sok. No.14/A Silivri, Istanbul, Turkey, and 
when acting for or on their behalf, any successors or assigns, agents, 
or employees (each a ``Denied Person'' and collectively the ``Denied 
Persons'') may not, directly or indirectly, participate in any way in 
any transaction involving any commodity, software or technology 
(hereinafter collectively referred to as ``item'') exported or to be 
exported from the United States that is subject to the Export 
Administration Regulations (``EAR''), or in any other activity subject 
to the EAR including, but not limited to:
    A. Applying for, obtaining, or using any license, License 
Exception, or export control document;
    B. Carrying on negotiations concerning, or ordering, buying, 
receiving, using, selling, delivering, storing, disposing of, 
forwarding, transporting, financing, or otherwise servicing in any way, 
any transaction involving any item exported or to be exported from the 
United States that is subject to the EAR, or in any other activity 
subject to the EAR; or
    C. Benefitting in any way from any transaction involving any item 
exported or to be exported from the United States that is subject to 
the EAR, or in any other activity subject to the EAR.
    Second, that no person may, directly or indirectly, do any of the 
following:
    A. Export or reexport to or on behalf of a Denied Person any item 
subject to the EAR;
    B. Take any action that facilitates the acquisition or attempted 
acquisition by a Denied Person of the ownership, possession, or control 
of any item subject to the EAR that has been or will be exported from 
the United States, including financing or other support activities 
related to a transaction whereby a Denied Person acquires or attempts 
to acquire such ownership, possession or control;
    C. Take any action to acquire from or to facilitate the acquisition 
or attempted acquisition from a Denied Person of any item subject to 
the EAR that has been exported from the United States;
    D. Obtain from a Denied Person in the United States any item 
subject to the EAR with knowledge or reason to know that the item will 
be, or is intended to be, exported from the United States; or
    E. Engage in any transaction to service any item subject to the EAR 
that has been or will be exported from the United States and which is 
owned, possessed or controlled by a Denied Person, or service any item, 
of whatever origin, that is owned, possessed or controlled by a Denied 
Person if such service involves the use of any item subject to the EAR 
that has been or will be exported from the United States. For purposes 
of this paragraph, servicing means installation, maintenance, repair, 
modification or testing.
    Third, that, after notice and opportunity for comment as provided 
in Section 766.23 of the EAR, any other person, firm, corporation, or 
business organization related to a Denied Person by affiliation, 
ownership, control, or position of responsibility in the conduct of 
trade or related services may also be made subject to the provisions of 
this Order.
    Fourth, that this Order does not prohibit any export, reexport, or 
other transaction subject to the EAR where the only items involved that 
are subject to the EAR are the foreign-produced direct product of U.S.-
origin technology.
    In accordance with the provisions of Section 766.24(e) of the EAR, 
Mahan Airways, Al Naser Airlines, Ali Abdullah Alhay, and/or Bahar 
Safwa General Trading may, at any time, appeal this Order by filing a 
full written statement in support of the appeal with the Office of the 
Administrative Law Judge, U.S. Coast Guard ALJ Docketing Center, 40 
South Gay Street, Baltimore, Maryland 21202-4022. In accordance with 
the provisions of Sections 766.23(c)(2) and 766.24(e)(3) of the EAR, 
Pejman Mahmood Kosarayanifard, Mahmoud Amini, Kerman Aviation, Sirjanco 
Trading LLC, Ali Eslamian, Mahan Air General Trading LLC, Skyco (UK) 
Ltd., Equipco (UK) Ltd., Mehdi Bahrami, Sky Blue Bird Group, and/or 
Issam Shammout may, at any time, appeal their inclusion as a related 
person by filing a full written statement in support of the appeal with 
the Office of the Administrative Law Judge, U.S. Coast Guard ALJ 
Docketing Center, 40 South Gay Street, Baltimore, Maryland 21202-4022.
    In accordance with the provisions of Section 766.24(d) of the EAR, 
BIS may seek renewal of this Order by filing a written request not 
later than 20 days before the expiration date. A renewal request may be 
opposed by Mahan Airways, Al Naser Airlines, Ali Abdullah Alhay, and/or 
Bahar Safwa General Trading as provided in Section 766.24(d), by filing 
a written submission with the Assistant Secretary of Commerce for 
Export Enforcement, which must be received not later than seven days 
before the expiration date of the Order.
    A copy of this Order shall be provided to Mahan Airways, Al Naser 
Airlines, Ali Abdullah Alhay, and Bahar Safwa General Trading and each 
related person, and shall be published in the Federal Register. This 
Order is effective immediately and shall remain in effect for 180 days.

    Dated: June 27, 2017.
Richard R. Majauskas,
Acting Assistant Secretary of Commerce for Export Enforcement.
[FR Doc. 2017-13972 Filed 6-30-17; 8:45 am]
BILLING CODE P